MSME sector in India is playing a decisive role in India’s progress through its contribution to domestic production, significant export earnings, developing regional economies, providing employment to a large workforce, creating competitiveness in the market, and offering innovations.
However, In spite of such enormous contribution towards India’s development, MSMEs in India still face various recurring issues
Challenges for MSME
- Lack of cost-effective technological solutions
- Inadequate strategic skills
- No digital presence & understanding of the platform
- Incompetence to attract the right talent.
These challenges have created roadblocks for MSMEs to scale to their full potential and rise as a national & international brand. Another major challenge for MSMEs is their functioning area is restricted to specific regions. This inability to serve larger customer base has made them over-reliant on the economics of operating regions and with the upsurge of cheap Chinese products in the market, not only it has increased the competition manifolds but also made their survival grim.
The pandemic made it worse for MSME
Covid-19 pandemic has also taught a hard lesson to the MSME sector that resorting to the traditional way of business could wipe out most of their hard-earned profits from the market.
The biggest disadvantages we faced during COVID19 were :
- If office doors were shut for a while, new players emerged due to so strong competitive markets.
- Customers stop recognizing your product because there are myriad competition products in the region.
- Interacting with team members became difficult
- Not every employee had laptops and related organization data with them
- Mobile phones were not strong enough to tackle all challenges by team members
- Staying in touch with customers became difficult
- Passing critical information to stakeholders like customers | management | team members became a daunting task
There is no panacea for all the challenges we faced during pandemic as there are many factors contributing to create an inclusive effect.
However, Digital Transformation of a business addresses many questions, which have been continued to daunt MSMEs since decades.
Benefits for MSME by going Digital
Digital Transformation of business has become more than consideration – it is a requisite in today’s business scenario. In order to stay relevant in today’s business climate, Digital Transformation offers several viable solutions, which deliver better results be it for marketing, projection, sales, vendor or customer management, planning customer services, business expansion, etc.
Multinationals and large industries have realized its benefits a long time ago and have been reaping its benefits since then. It is now time for MSMEs to understand the unprecedented benefits of Digital Transformation and transformation that it brings to the way businesses operate.
What is Digital Transformation and how does it help businesses?
Digital Transformation for MSME is:
- Digitizing all the depts i.e. sales | finance | operations | inventory | productions with documented SOPS (standard operating procedures) & related policies
- Solving day to day recurring issues in sales | finance | operations | inventory | productions
- Automate recurring cumbersome tasks and data management.
- Transforming entire business processes using 21st-century cost-effective digital products.
Data is the new fuel – Mr. Mukesh Ambani (in 2018)
FACT: He made $14 billion during COVID 19, much more funds than all the Indian startups al together
Many large companies are taking it very earnestly to drive intelligent business decisions. Right decisions at the right time can play a significant role in building a success story.
Digital Transformation provides businesses a platform that gives easy access to a large amount of organized data. The new digital tools and techniques allow businesses to easily manage and use any amount of incoming data.
This data has the potential to unlock valuable insights that companies can use to make strategic business solutions and intelligence decision making.
Smartphone users have mushroomed in this decade. The habits of people have clearly changed with the development of internet technology. Now an average user spent more than 2 hours on their mobile device. Mobile devices have turn out to be a key place to promote your brand. Digital Marketing not only allows businesses to reach a global audience but also targets a specific group of people that qualify your buyer’s persona. \
Targeting people who are more likely to buy your product saves hefty bucks unlike traditional methods of marketing like print media, television ads, hoardings that can dig a hole in your pocket.
Digital Transformation also improves customer experience and engagement. The tools like automated chatbots, automated mail replies are very useful in growing customer satisfaction and improving company brand image. It is also easy to bring together customer feedback and draw inferences to upgrade products and services. The one lesson we should learn from a company like Kodak and Nokia that customer’s choices frequently change with time and it can’t be ignored otherwise a time will come when they will start ignoring you. It is not enough to have a great product but regular updates to your product and services are vital to surviving.
One of the most common challenge that MSME’s face is to hire the right talent that can become their support system and take their business to new heights.
A right person align himself with company’s vision and work persistently to realize company’s goal. The MSMEs fail to attract right talent due to a bounded existence in the business world.
Digital Transformation helps MSMEs to project themselves as technology and future-driven company. The candidates feel that their working in such a tech-driven company can give them a plethora of experience and make them future-ready.
The key takeaway here in order to stay relevant in today’s business scenario, companies whether large or small, must transform themselves digitally.
Digital Transformation technology has been evolving constantly with time and it is easy to get overwhelmed by the latest tools and techniques. The point here to consider is which strategy will be beneficial for your business.
A well-planned strategy can help businesses to reap fruits in a short period. The businesses that embrace digital transformation will see themselves at an advantage with improved decision-making, customer experiences, employees’ efficiency, and profitability.